Our aims are: (1) Develop a complete conceptual model of the determinants of fertility which incorporates community level factors. This model expands upon the economic model of household demand for children by explicitly including a broader range of individual and household variables, as well as community factors. While the ultimate dependent variable is recent fertility, determinants of demand for children and use of fertility regulation will also be investigates. (2) Develop a conceptual view of the processes by which the environment influences fertility, which arises from the theoretical model. (3) Develop appropriate procedures for estimating the model and its key components. Advanced econometric procedures will be used to estimate individual, household and community determinants. Careful consideration will be given to whether variables should be considered exogenous or endogenous (based on the theoretical model), to appropriate temporal relationships, and to assumptions about the error structure. (4) Estimate the model for two developing countries using unusually rich data sets. The countries and regions proposed are the Bicol region of the Philippines and Mexico. The data will permit testing a more realistic and complex model of household decision making, involving developing and testing better measures of the dependent and independent variables. (5) Simulation will be used to help pinpoint areas where missing data are likely to lead to model misspecification and biased estimates of parameters and to conduct policy and behavioral simulations using estimated parameters for the two countries, thereby helping identify future data collection needs. Implementation of the project should lead to an appreciation of the value of a complete theory of household fertility decision making for clearly specifying hypotheses about how community-level factors influence fertility. This will permit more valid policy inferences -- a major long-term objective. Similarly, identifying areas of needed data collection relates directly to another major objective to participate in questionnaire and survey/sample design in a future survey developing country to progress towards filling the gaps.